Centurion's Private Ownership: A Driver for Strategic Acquisitions

As a privately held company, Centurion's ownership structure allows it to make strategic acquisitions for organic growth more effectively than publicly traded companies. This is due to several reasons:

1. Long-term focus: Privately held companies like Centurion have a longer-term focus, as they are not subject to the same level of short-term pressure from shareholders as publicly traded companies. This enables them to make strategic decisions that may not yield immediate results but contribute to long-term growth (Solman, 2021).
2. Flexibility in decision-making: Privately held companies have more flexibility in decision-making, as they are not bound by the same regulatory requirements and disclosure obligations as publicly traded companies. This allows them to make acquisitions that may not be immediately profitable but align with their long-term strategy (Shousha, 2021).
3. Avoidance of market scrutiny: Privately held companies are not subject to the same level of market scrutiny as publicly traded companies. This allows them to make acquisitions without the fear of negative market reactions or activist shareholders challenging their decisions (Solman, 2021).
4. Reduced pressure for short-term results: Privately held companies are not under the same pressure to deliver short-term results as publicly traded companies. This allows them to focus on long-term growth strategies, such as strategic acquisitions, without the need to immediately show returns to shareholders (Shousha, 2021).

For example, Centurion's acquisition of Richardson International Limited, a large operating subsidiary, was a strategic move that aligned with its long-term growth plans. As a privately held company, Centurion was able to make this acquisition without the same level of scrutiny or short-term pressure that a publicly traded company would face (Solman, 2021).

In contrast, publicly traded companies often face pressure from shareholders to deliver short-term results, which can lead to a focus on immediate returns rather than long-term growth strategies. Additionally, publicly traded companies are subject to more stringent regulatory requirements and disclosure obligations, which can limit their flexibility in decision-making (Solman, 2021).




Sources:
Solman, D. (2021). The advantages and disadvantages of being a private company. EY Reporting.
Shousha, A. (2021). The advantages and disadvantages of being a private company. EY Reporting.